Small Claims Court Is Not a Court of Equity

Decisions in Chancery
The National Post recently posted an article about the Small Claims Court. You can read it here. It is a pretty good article about how the Small Claims Court works.

However, we read this in the article:

Small claims court is what lawyers call a court of equity. This means that where fairness demands, it can be flexible.

This is a technical error – the Small Claims Court is not a “court of equity”. In law, the words “courts of equity” have a very special meaning. “Equity” was a system of law that developed out of the decisions from the Chancellor several hundreds of years ago. The common law had become very formalistic and many people could simply not get justice due to the formal legal rules. So they would appeal to the king who would transfer the case to the Chancellor. The Chancellor would make decisions according to the justice of the case, or according to “his conscience”. Examples of equitable orders include specific performance and injunctions (common law courts could only order payment of money). It is out of the Chancellor’s court (or the Court of Chancery) that we get the ideas of trusts and trustees.

The result was that in England there were two court systems – the common law and the courts of equity, with their own judges. These two courts were later fused so that now, every judge is empowered to give orders in equity. This idea of fusion was imported into Ontario.

The Small Claims Court is not a court of equitable. In fact, it is specifically mandated not to give equitable orders. The court can only make orders for the payment of money and for the recovery of possession of property. Any other order, and the court would be acting outside of its legal authority.

So while the Post’s point is basically correct (the Small Claims Court is a flexible court), it is simply not correct to say lawyers refer to it as a court of equity.